Bake off winners
In our 6/24/20 note, we mentioned that strained relations between Japan and South Korea has pushed the South Korean Ministry of Trade to sponsor a Fine Metal Mask ‘bakeoff’ pitting a number of South Korean companies against each other to find the best production methodology to develop an in-country supply chain, allowing South Korea to become less dependent on Japan for this critical part of OLED production technology. These masks are precision components as a typical 6” smartphone display can have over 12m sub-pixels that must be of a very specific size, pattern, and location and must be exceedingly thin to avoid shadows that can deposit materials incorrectly. That said, if the mask is too thin, it will sag and misplace pixels. Further, as the masks become coated with OLED material that does not pass through the minute holes, they need to be cleaned and replaced on a regular basis.
South Korea imports nearly 100% of its FMMs and that dependence has been a cause for concern, not only for the South Korean government, but also for dominant OLED producers Samsung Display and LG Display (LPL). Strained relations with Japan, the source of both the masks and the material from which they are made (Invar), over a dispute going back to WWII caused the concern, with the South Korean government developing a competition between APS (054620.KS), Philoptics (161580.KS), Poongwon Precision (pvt), and Olum Materials (pvt). The latter two use etching to create the FMM, while APS uses laser patterning, and Philoptics uses electro-forming, essentially a process that deposits metal on a mandrel, which is later separated from the mask material. Laser patterning is just what you would expect, using high-powered, micro-precision lasers to form the mask ‘holes’. Poonwong and Olum use more typical etching methods used by Dai Nippon Printing (7912.JP) and Toppan Printing (7911.JP), which roll the mask to the desired thickness and etch the ‘holes’ in the same way semiconductor material is etched.
The South Korean Ministry of Trade has now chosen APS (laser patterning) and Poongwon (etch) as the winners in the project, which will now focus on the development of a 600ppi mask for Gen 6 OLED fabs. That said, the target for such development is 2023, which means that Korean OLED producers will remain dependent on Japan for FMMs for another three years. Considering that Hitachi Metals (5486.JP) is the leading supplier of Invar, it will likely take even more time to build out a FMM infrastructure. Credit for the effort, but “Lost Time is never found again” (B. Franklin – “Poor Richard’s Almanack)
South Korea imports nearly 100% of its FMMs and that dependence has been a cause for concern, not only for the South Korean government, but also for dominant OLED producers Samsung Display and LG Display (LPL). Strained relations with Japan, the source of both the masks and the material from which they are made (Invar), over a dispute going back to WWII caused the concern, with the South Korean government developing a competition between APS (054620.KS), Philoptics (161580.KS), Poongwon Precision (pvt), and Olum Materials (pvt). The latter two use etching to create the FMM, while APS uses laser patterning, and Philoptics uses electro-forming, essentially a process that deposits metal on a mandrel, which is later separated from the mask material. Laser patterning is just what you would expect, using high-powered, micro-precision lasers to form the mask ‘holes’. Poonwong and Olum use more typical etching methods used by Dai Nippon Printing (7912.JP) and Toppan Printing (7911.JP), which roll the mask to the desired thickness and etch the ‘holes’ in the same way semiconductor material is etched.
The South Korean Ministry of Trade has now chosen APS (laser patterning) and Poongwon (etch) as the winners in the project, which will now focus on the development of a 600ppi mask for Gen 6 OLED fabs. That said, the target for such development is 2023, which means that Korean OLED producers will remain dependent on Japan for FMMs for another three years. Considering that Hitachi Metals (5486.JP) is the leading supplier of Invar, it will likely take even more time to build out a FMM infrastructure. Credit for the effort, but “Lost Time is never found again” (B. Franklin – “Poor Richard’s Almanack)
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